Rental supply falls 23% since the pandemic while demand skyrockets 200%: 50 people are interested in each apartment
The mismatch between supply and demand has unleashed the perfect storm in the rental market. The number of apartments available for rent has been reduced by 23% in Spain compared to before the pandemic. In parallel, since 2019, demand has grown more than 200%: in the first ten days since an apartment is offered for rent, an average of 50 people are interested in each advertisement, when five years ago they did not reach 17. The situation is especially alarming in some areas of the country. Along with the archipelagos, Catalonia and Madrid stand out among the regions where the most applicants are competing for the same apartment, while the Valencian Community and Andalusia are among those where prices have increased the most.
This is the photograph that emerges from the data of the first rental barometer prepared by the Safe Rental Foundation in collaboration with the Rey Juan Carlos University (URJC). This research is the work that launches the Rental Observatory, a study center launched this Wednesday by both organizations with the aim of offering data and information on the rental market and promoting transparency in the sector.. “It will not only allow us to analyze supply and demand, but also evaluate the impact of public policies carried out on the housing market,” researcher Fernando Pintor, professor at the URJC, explained in the presentation.
The figures released this Wednesday confirm that the supply of apartments for rent is increasingly smaller, while demand continues to grow. These contrary trends push prices up. Before the pandemic shook the real estate market, there were 982,194 apartments available for rent in Spain, according to the barometer, created using real estate data.. This volume remained stable in 2020 and rebounded in 2021 to exceed 1.05 million apartments. Since then, the drop in supply has been unstoppable until reaching 754,360 homes available for rent in 2024, a projection prepared for this year based on the data available for the first quarter.. This figure is 7.3% lower than that of 2023 and is 23.2% below the pre-covid volume.
The lower availability of apartments for rent, which the authors of the study attribute to the legal insecurity and uncertainty faced by owners, has meant that supply is not able to absorb demand.. In this way, the pressure to get one of these properties has skyrocketed.. Although the situation is very heterogeneous in different parts of the country, there are regions in which families face significant difficulties in accessing these accommodations.
The Balearic Islands and Santa Cruz de Tenerife are the areas where rental advertisements arouse the most interest: on average 143 and 103 people respectively contact each offer in the first ten days. The authors of the barometer point out that the situation must be considered risky from 15 interested parties per home, a limit that Extremadura, Castilla y León, Murcia and La Rioja are the only regions that do not exceed -Aragón, Castilla-La Mancha and Galicia touch it.
Barcelona also exceeds the threshold of 100 people, despite the fact that before the pandemic the figure stood at 17.5. Currently, on average it only takes 15 days from when an apartment goes on the market until it is rented.. The pressure from this province strains the situation of the entire autonomous community, where there are 129,372 available for rent. Catalonia is the third region with the most housing offered, but at the same time it is also the fourth where the volume has decreased the most since 2019, when the number of properties in the rental market was close to 200,000 units and exceeded 217,600 in 2021 .
Among the communities with the greatest mismatch between supply and demand for rentals is also Madrid, where on average 63.4 people are interested in each apartment available on the market, above the national average and the 20.7 that they did in 2019. The supply in the region has been reduced by 21.7% in the last five years to 144,552 homes available. The pressure from Madrid has spread to neighboring areas. “In Segovia, the rental market is highly influenced by the proximity to Madrid,” exemplifies Sergio Cardona, head of sustainability and quality at Safe Rental.
The situation is somewhat less tense in the Valencian Community, where an average of 44 people are interested in each apartment during its first ten days on the market, four times more than in 2019.. However, the pressure is very different between provinces, since in Valencia the figure exceeds 63 contacts per advertisement, while in Castellón it does not reach 9. The same happens in Andalusia, where this indicator is around 30 people in Málaga and Córdoba, but barely exceeds 10 in Granada.
Rising prices
These imbalances have pushed rental prices up.. At the national level, the average monthly rent has risen to 1,069 euros in the first quarter of 2024, an amount 24.7% higher than the 857 euros that each tenant paid on average per month in 2019. In the last year alone, prices have grown by 6.7% compared to 2023.
No autonomous community escapes this trend. The Valencian Community, the Canary Islands, Castilla-La Mancha and Andalusia have been the ones that have registered the most pronounced increases in the last five years, with increases of between 40.7% and 32.9%. However, the Balearic Islands, Madrid and Catalonia top the ranking of autonomous regions with the most expensive rents, with average rents of 1,591, 1,460 and 1,361 euros per month.